Premium Essay

Electricity in Indonesia – Issues and Recommendation

In: Business and Management

Submitted By rinaldi225
Words 2214
Pages 9
Electricity in Indonesia – Issues and Recommendation

I. Current Condition and Issues
Electricity is a vital engine for growth, development and prosperity for the country. Above all, it helps improve the quality of life of the Indonesia people countrywide. However, until now, Indonesia still have 2 big challenges to provide sufficient and cost effective electricity to support its population quality of life and support Indonesia business and industries economic growth plan as elaborate below.
1. Insufficient electricity supply to support electricity demand and economic growth
The lack of adequate and reliable supplies of electric power is one of the most serious problems facing Indonesia today. As of year 2011, as shown in the following table, PLN have about 29,268 MW installed capacity in Indonesia. About 76% is in Java and the remaining 24% is outside Java.

Source : Statistic Report 2011 from www.pln.co.id
The current capacity provided by PLN is not enough to serve all the Indonesia population and Indonesia economy growth plan. Target electrification ration in Y2012 is is only 75%, so it is still more than 12 million households in Indonesia don’t have electricity. particularly outside Java.

Electricity shortage has also hit most parts of Indonesia, especially outside Java. For Industrial companies, the impact is lost of production hours. Household consumers were also harmed due to rolling blackouts. Government also feared that this Electrical problems would undermine the economic growth target of 7 percent per year.

In general electrification plan for 2005-2025, envisaged that the power deficit is a necessity. Growth in electricity consumption reaches about 7 percent per year, while the increase in power supply less than 4 percent. With this condition, it is definitely overwhelmed PLN electricity demand.

World Bank and its

Similar Documents

Premium Essay

Bio Fuel in Indonesia

...Algae biofuel in Indonesia: Challenges and Future Prospects Andre Budinarta A0113820W Ang Ee Meng, Samuel A0113625N Pham Trong Binh A0091176A National University of Singapore Introduction Objective This paper will look into the possibility of using algae for energy security in Indonesia. The prospects of algae being advantageous for the economy to undertake will be discussed. This paper will also focus on the development of such energy facilities in Indonesia. Background The consumption for electricity has been increasing in Indonesia (CIA World Factbook, 2013). This was due to the positive growth the economy has been experiencing in recent years (Trading Economics, 2013). In addition, the population is expected to increase from its current 239.9 million to 278.5 million by 2030 (The World Bank Group, 2011). This will lead to a surge in the demand for energy and electricity in the future. In light of today’s depleting fossil sources, there is a need to search for energy alternatives, for energy security. The government has actually implemented policies involving other forms of energy, such as solar, wind and biodiesel. As of 2012, renewable energy accounted for 11.5% of total energy production (Global Energy Statistical Yearbook, 2013). Algae, a 3rd generation biofuel, have not been brought forward by the government due to the lack of research and development capabilities in the country (Winston, 2013). Despite this, there...

Words: 9151 - Pages: 37

Premium Essay

Summary Report

...Summary Report Executive Summary After analyzing PEST analysis of Indonesia and Saudi Arabia, I came to know it has some advantage and disadvantage in term of legal policy, economic factor, social, geographic and technological factor. Although GDP growth rate, labor force, and lending interest rate are more in Indonesia, they have unstable central government, huge population, high inflation, persistent corruption and natural disaster. Indonesia’s investment climate ranks poorly in international comparisons. The World Bank’s Doing Business 2007 report ranks Indonesia 135th out of 175 economies on ease of doing business. Macroeconomic instability is still viewed as the biggest obstacle, followed by poor transportation service and corruption in electricity such as stealing. Other major obstacles include labor skills, tax administration, cost of financing, and labor regulation which raise the cost and uncertainty of doing business. In Indonesia FDI is restricted in most of the sectors and the business environment is not good,so I recommend do not invest in Indonesia and Saudi Arabia has the strongest political, economic, legal systems providing the best opportunity and potential for overseas expansion. Friendly government business regulations and vast petroleum reserves might be indicative of low political and financial risk for foreign direct investment and therefore a strong candidate for overseas growth. The year over year increase in GDP might also indicate that the general...

Words: 1112 - Pages: 5

Free Essay

Test Paper

...| Singapore School, Kebon JerukAffiliated to Singapore International School (Indonesia) | INTERDISPLINARY PROJECTS TERM 1 AY. 2013-2014 Name:____________________________________ | LEVEL: Secondary | Subject/s: 1. A-Math 2. Bahasa Indonesia 3. Biology 4. Business Studies 5. Chemistry | 6. Chinese Language 7. Extended Math 8. FLE 9. Geography 10. Physics | | | Teacher in charge: Subject teacher in chargeA Math, E-Math, Physics:Business Studies, Economics and GeographyBiology and Chemistry FLE Bahasa Indonesia:Chinese Language | Ms. Syafrina MachfudMr. Suresh Ms. Syafrina Mr. Abner (Upper secondary), Ms Jaimi (Lower Secondary)Mr. Jeff (Upper secondary) and Ms Moneth (Lower Secondary)Ms. Titik (upper secondary), Ms Ice (Lower Secondary)Mr Gao WG (Upper secondary), Gao DZ (Lower secondary) | Note: Please contact your subject teacher for specific subject requirement | 1. Background To celebrate the World Food Day on 16 October 2013, the IDP will derive the ideas from the Global Food Crisis. More than 842 million people in the world are undernourished. The Global Food Crisis presents a challenge to those working to alleviate world poverty. The full extent of its causes and effects are still far from totally understood and there is significant debate about the most effective and fairest ways to tackle the Crisis. What is clear is the extent of rising food prices. For example between the start of 2006 and mid 2008 the average world...

Words: 2932 - Pages: 12

Free Essay

Fuel Subsidies

...Indonesia’s Fuel Subsidies: Action plan for reform David Braithwaite Alexander Chandra Prasetyaning Diah R. L. Ami Indriyanto Kerryn Lang Lucky Lontoh Nataliawati Siahaan Damon Vis-Dunbar Bobby A. Wattimena Unggung Widhiantoro Peter Wooders NE SI A N I N S TI TU T E F OR E N E RG IN DO I I EE FO U N D AT I O N C O NOM I YE CS March 2012 www.iisd.org/gsi © 2012 The International Institute for Sustainable Development © 2012 The International Institute for Sustainable Development Published by the International Institute for Sustainable Development. About IISD The International Institute for Sustainable Development (IISD) contributes to sustainable development by advancing policy recommendations on international trade and investment, economic policy, climate change and energy, and management of natural and social capital, as well as the enabling role of communication technologies in these areas. We report on international negotiations and disseminate knowledge gained through collaborative projects, resulting in more rigorous research, capacity building in developing countries, better networks spanning the North and the South, and better global connections among researchers, practitioners, citizens and policy-makers. IISD’s vision is better living for all—sustainably; its mission is to champion innovation, enabling societies to live sustainably. IISD is registered as a charitable organization in Canada and has 501(c)(3) status in the United...

Words: 22015 - Pages: 89

Free Essay

Master Plan Indonesia

...MASTERPLAN ACCELERATION AND EXPANSION OF INDONESIA ECONOMIC DEVELOPMENT 2011-2025 R EPUBLIC OF I ND ON ES IA Doc. Wijaya Karya Masterplan for Acceleration and Expansion of Indonesia Economic Development © Copyright Coordinating Ministry For Economic Affairs, Republic of Indonesia Published by Editor Design by : Coordinating Ministry For Economic Affairs : Deputy Minister for Coordinating Infrastructure and Regional Development, Coordinating Ministry For Economic Affairs : IndoPacific Edelman First Published 2011 All Rights Reserved Coordinating Ministry For Economic Affairs, Republic of Indonesia Masterplan for Acceleration and Expansion of Indonesia Economic Development Jakarta: Coordinating Ministry For Economic Affairs, 2011 212 pages; 28 x 30 cm ISBN 978-979-3754-14-7 Masterplan aCCeleratIOn anD eXpansIOn OF InDOnesIa eCOnOMIC DeVelOpMent 2011-2025 Coordinating Ministry For Economic Affairs Republic of Indonesia 6 Masterplan P3EI Abstract Doc. Astra Otoparts Doc. Wijaya Karya Doc. Wijaya Karya Table of Contents Preface from The President of Republic of Indonesia Abstract Historical Breakthrough in the Making of MP3EI 1. The Self-Sufficient, Advanced, Just, and Prosperous Indonesia A. Preface B. Acceleration and Expansion of Indonesia Economic Development C. Indonesia’s Position Within The Regional and Global Dynamics D. Indonesia’s Potential and Challenges E. Acceleration of Economic Transformation - A New Way of Working...

Words: 70148 - Pages: 281

Premium Essay

Analysis and Comparative Study of Three Micro Small Medium Enterprises (Msme) in Bogor

...in 1998. Monetery crisis that hit Indonesia had caused previous business collapsed and went bankrupt, causing the business owner started to sell cotton candies on the street… Cont’d to Page 4 Business Profile Busines Profile : Bening Jati Anugrah Food; A Frozen Food Manufacturing Company Bening Jati Anugrah Food is a small medium enterprise manufacturing frozen food from ocean fish as raw materials. Using Bening Food as its brand, this business is located in… Cont to Page 4 Business Profile Business profile : Hot Crispy Hot Crispy is a food processing business that was established in 2005, or roughly about 10 years ago. Products offered are …Cont’d to Page 5 December 15, 2015 http://metrovaartha.com Background M i c r o , S m a l l a n d Me d i u m E n te r p r i s e s (MSMEs) in Bogor are one among various economic sectors that have contributed in regional revenue and also in employment sectors. Approximately 11.297 MSMEs in Bogor City (kotabogor.co.id, 2015) that employ 19.035 workers, and around 15.000 people involved in MSMEs in Bogor regency (business.com, 2015). As a follow up on this significant development, Bogor city administrators have transformed the Cooperation affairs office into Cooperation and MSMEs office to better manage the SMEs potential in Bogor City. Business development of MSMEs in both Bogor city and regency is expected to contribute significant solution to unemployement issues in that areas… Cont’d to Page 2 ...

Words: 2286 - Pages: 10

Free Essay

Emerging Asian Markets

...Foreign Direct Assessment: Analyzing the Mobility of FDI Models in Emerging Markets Kyle Himmelwright & Damian Zaccaria, Villanova Business School In this article, the authors will explore foreign direct investment in emerging markets. Applying a two prong investment model, they’ll assess three emerging Southeast Asian marketplaces; Indonesia, Thailand, and Malaysia. Additionally, they’ll explore the impact a variety of explicit and implicit factors have on the outcome. The research will indicate which of the three markets has the most potential for investment. Keywords: Foreign Direct Investment (FDI), emerging markets, investment, economic factors, growth, defense Foreign direct investment (FDI) plays a prominent and growing role in the global marketplace. FDI is defined as an investment made by a company or entity based in another country. The investment provides the firm with an opportunity to access new markets and marketing channels, cheaper production facilities, access to new technology, products, skills and financing (Goingglobal.com 2015). Accurately assessing marketplace factors is essential when evaluating whether to invest in a foreign market, especially when it comes to making decisions requiring foresight and conviction. “The world is changing very fast. Big will not beat small anymore. It will be the fast beating the slow.” Rupert Murdoch’s quote concisely illustrates the current state of the global marketplace; it simply isn't as big as...

Words: 10050 - Pages: 41

Premium Essay

Energy

... 3. Ubaid-ur-Rehman (3778) 4. Junaid Ghayoor Hussain (3780) 5. Muhammad Ansaar (3824) 6. Abdul Sami khan (3825) ABSTRACT Electricity Crisis in Pakistan is one of the severe challenges the country is facing today. Electricity is essential part of our daily life and its outage has severely affected the economy and overall living of ours. Thousands have lost their jobs, businesses; our daily life has become miserable. Pakistan is currently facing upto 18 hours of electricity outage a day, is expected to face more if not dealt with in time. The purpose of this study is to analyze the nature of this crisis and to propose some short-term as well as long-term solutions to this problem. This study is exploratory in nature. We have done our best to conclude and sketch up some recommendations in the light of identified hurdles in the way of implementing the appropriate solution to our problem. Our study finds some major wholes in our system if they are covered up we can not only overcome the deficiency of electricity in our systems but also we can be able to export it to our neighboring countries. The basic flaws that our study identified are related to circular debt, and the inadequate capacity of our electricity production and distribution systems. Also we emphasized on some prospective alternatives to our electricity production that are cheaper and they provide more clean electric energy as compared to fossil fuel run energy plants. INTRODUCTION * Background...

Words: 4670 - Pages: 19

Free Essay

Zhouzhuang Wyndham Hotel Sustainability Project

...Professor Jia Wu Group # 9 Yidi Zhang Hui Zhang Sanaz Zarghami Khosravi INTRODUCTION Zhouzhuang Wyndham Grand Plaza is a Chinese five-star luxury hotel, located in Zhouzhuang, a famous tourist resort. Its total area is 34,022 m2. According to a Chinese star hotel report, the average annual electricity consumption of a Chinese star hotel ranges from 100kwh/m2 to 200kwh/m2, ten times as the consumption of a common household. Compared to the population mean, our target hotel consumed about 130.34kwh/m2, which is a comparatively large consumption. The reason why we disregard other resources consumption, like water consumption, is that this hotel has installed facilities as their infrastructures for water use efficiency. The reason why the ballroom (which is mainly for accepting customers, holding banquets and arranging meeting and other versatile functions) is our target objective is that the ballroom has a high utilization rate compared with such like bedrooms and entertainment areas etc. Another reason is that the ballroom takes up the largest space among the single area in the hotel and the solar panels are going to be installed on the roof of the ballroom. As the electricity consumption varies from season to season in that during summers and winters, the peaks of consumption will occur, especially in the summer because the AC systems, including all refrigerating facilities, keep working for 24 hours. Meanwhile, considering different alternatives that may be used as the...

Words: 4597 - Pages: 19

Premium Essay

Financial Performance Review and Estimating Company Value of Pt Aneka Tambang (Persero) Tbk in Comparison with Other Local Mining Company: Pt Vale Indonesia Tbk

...FINANCIAL PERFORMANCE REVIEW AND ESTIMATING COMPANY VALUE OF PT ANEKA TAMBANG (PERSERO) TBK IN COMPARISON WITH OTHER LOCAL MINING COMPANY: PT VALE INDONESIA TBK Muhammad Naufal Aflah and Ana Noveria School of Business and Management Institut Teknologi Bandung, Indonesia naufal.aflah@sbm-itb.ac.id Abstract: The researcher will try to analyze about the past, current, and future financial condition and make a valuation about firm’s value of two companies that dominate the mining sector of industry in Indonesia which are PT Aneka Tambang (Persero) Tbk (ANTAM) and PT Vale Indonesia Tbk, formerly PT International Nickel Indonesia Tbk (VALE). To assess the financial performance of PT Aneka Tambang (Persero) Tbk, researcher will use several methods which are time-series analysis (Compound Annual Growth Rate), cross-section analysis, common-size analysis, and DuPont Analysis (ROA and ROE). Then make a valuation of the firm’s value using three valuation approach which are asset based method, market approach, and income approach better known as discounted cash flow approach. Based on the results, ANTAM has better performance in their net working capital through total current assets, current liabilities, retained earnings, and share capital. Nevertheless, VALE has good capability in attract the investors and controlling their non-current assets, non-current liabilities, and additional paid in capital. In overall, ANTAM has better financial performance than VALE in terms of CAGR comparison...

Words: 5585 - Pages: 23

Premium Essay

Strategic

...August 2014 TABLE OF CONTENTS I. INTRODUCTION: 3 1. Management and ownership 3 2. An overview of REE's businesses 3 3. Office leasing business 5 4. M&E business 6 5. Air conditioner manufacturing 7 6. Investing is REE's new core competency 8 II. OUTLOOK 10 III. SWOT analysis 19 IV. FINANCIALS 21 1. Good cash flow from office leasing and dividends 21 2. Profits from investments drive earnings growth 22 3. 2013 results review 24 4. 2014 forecasts 26 5. Restatement of 1Q13 earnings depresses yoy performance for 1Q14 28 6. Recent developments among investee companies 29 7. Volatile net margins 29 V. VALUATION AND RECOMMENDATION 29 VI. REFERENCE: 32 I. The company REE has been research for the critically and analyze about the finance of the firm, risk or evaluate on investment recommendation also of this firm. II. INTRODUCTION: REE was founded in 1977 as an M&E (mechanical and engineering) contractor for building projects. The company was privatized in 1993 and began manufacturing its "Reetech" brand of air conditioners in 1999. In 2000, REE became one of the first two companies to list on the Ho Chi Minh City Stock Exchange, and is still usually among the top 10 most liquid stocks in Vietnam. In 2001, REE branched into property investment and construction with its grade B "Saigon E-town", office building project. The cash flows from this project and its core businesses funded a series of savvy investments in additional grade...

Words: 10256 - Pages: 42

Premium Essay

Solar Energy Company Report Csr

...Responsibility in the Solar Photovoltaic Industry CSR Across Industries CSR Across Industries Table of Contents Executive Summary 3 The Solar Photovoltaic Industry and CSR related issues 3 Introduction 3 CSR Issues 4 Companies 4 The Companies 5 1. British Petroleum – (Philip Leith) 5 2. ENEL – (Santiago Liotta) 7 3. MEMC Electronic Materials, Inc. / SunEdison – (Eleonora Ricciardi) 9 4. Sharp Solar – (Aaron Teo) 11 5. Suntech – (Tutram Nguyen) 13 Companies Comparison and Evaluation 16 Conclusions 17 Bibliography 18 Executive Summary In the last decade, the solar industry has seen exponential growth. Government subsidies, climate change debate and need to identify alternative eco-friendly energy sources have fueled this sector. The idea of harnessing renewable energy from the sun is naturally attractive but is it a perfect solution? Do the companies profiting in this business abide to the same United Nations Global Compact principles urged by environmentalist, conservationists, human rights activists, governments and other stakeholders around the world? This paper will provide our findings on our evaluation of five global players against a handful of corporate social responsibility issues in the solar industry. The Solar Photovoltaic Industry and CSR related issues Introduction As traditional hydrocarbon supplies are increasingly difficult and expensive to extract, energy companies have to change their strategy in order to meet the demands of...

Words: 5606 - Pages: 23

Premium Essay

Marketting Consultancy Report

...SARAWAK INFORMATION SYSTEMS SDN BHD (SAINS) Contents SARAWAK INFORMATION SYSTEMS SDN BHD (SAINS) 1 CHAPTER ONE 4 1. INTRODUCTION 4 1.1. Mission, Vision and Core Values of SAINS 4 1.2. Core Competencies 5 2. CHAPTER TWO 6 2.1. SAINS Environmental Analysis 6 2.2. SAINS Key Drivers of Change 8 2.3. SAINS Value Chain 8 2.3: 5 M’s of Marketing 11 2.4. Porters 5 Forces of SAINS 12 2.5. Internal analysis and External analysis 13 2.6. Applying Direct Policy Matrix 16 2.7. Potential Strategic Challenge/Issues 17 2.8. SAINS Marketing Objectives 19 3. CHAPTER THREE 22 3.1. ANSOFF MATRIX 22 Market Penetration 22 Market Development 23 3.2. SAINS Marketing Mix 24 Product / service 24 Promotion 24 Price 25 Place 26 People 26 BUDGET AND FINANCIAL FORECAST FOR NEXT 3 YEARS 28 CHAPTER FOUR 33 4. RECOMMENDATION 33 Value 33 Rarity 33 Imitable 33 Organizational Knowledge 33 5. CONCLUSION 34 CHAPTER ONE 1. INTRODUCTION Sarawak Information Systems SDN BHD (SAINS) is a leading ICT System Integrator and Solution Provider in the state of Sarawak, Malaysia. It has effectively enlarged and intensified the utilization of ICT resulting in IT growth among state government agencies in Sarawak since the mid 1980’s. In the mid 1980’s, the use of IT among state government agencies in Sarawak started to grow. Shortly thereafter, in 1991 SAINS was formed and was given the task of leading the development and implementation...

Words: 7421 - Pages: 30

Free Essay

Blah Di Blah Di Blah

...|  Hussain Industries: Hussain industries is known to be one of the largest textile manufacturers in Pakistan. It is located in the hub of textile industries in Pakistan, the city of Multan, which is also famously known as the largest cotton growing city. This company is a partnership and is currently equally being shared between two parties. Hussain industries has been manufacturing articles with intense colour tones which include the following: Articles with intense color tones, including dyed yarns, printed kitchen towels, napkins, tea towels, table cloths, terry towels, surgical towels, industrial towels (with and without logo, tile motifs, check variants, micro checks, graduated checks and linear embroidery), herringbone, mono checks, dishcloths, shower curtains, hospital bed sheets, thermal blankets, bedspreads, draw sheets, upholstery, handkerchiefs, aprons, place mats, pot holders, gloves, and beach throws. These are manufactured using dobby looms, jacquard looms, and shuttle looms, which allow for state of the art floral motifs, subtle shadows, and colour gradients. KARACHI:  The textile sector enjoys a pivotal position in the exports of Pakistan. The contribution of this industry to total gross domestic product (GDP) is 8.5%. It provides employment to about 15 million people, 30% of the country’s workforce of about 49 million. The annual volume of total world textile trade is $18 trillion which is growing at 2.5%. But Pakistan’s share is less than one per cent...

Words: 7160 - Pages: 29

Premium Essay

Business Risk

...2.0 ISSUES ON INTERNATIONAL CORPORATE RESPONSIBLE There are many issues in International Corporate Social Responsibility (CSR) that can affect the company to make decision how to accomplish the CSR. We will discuss three issues of International Corporate Social Responsibility which are: 2.1) Type of International Corporate Social Responsible. 2.2) Advantages and Disadvantages of International Corporate Social Responsible. 2.3) Barrier of doing International Corporate Social Responsible. 2.1) Company must decide which type of International Corporate Social Responsible they must select rightly if not it can affect the company. There are three type of International Corporate Social Responsibility. 2.1.1) First is environmental responsibility. Environmental responsibility is organizations starting to focus on their waste and carbon footprint and find solution to reduce it. Besides that, companies must look for new ways that their operations can be more productive for the environment, by having a minimal impact. 2.2.2) Next is philanthropic responsibility. Philanthropic responsibility is like the organization gives money to donating to national and local charities. Usually, the organizations will have specific charities that they support, and these may be linked to business. 2.2.3) Besides that is ethical responsibility. It can be done by the organization meet their profitable which organization willing to pay higher wages...

Words: 2074 - Pages: 9